Midland Resources has two production departments (Fabrication and Assembly) and three service departments (Engineering, Administration, and Maintenance). During July, the following costs and service department usage ratios were recorded.

Supplying DepartmentUsing DepartmentEngineeringAdministrationMaintenanceFabricationAssemblyEngineering050%010%40%Administration10%020%50%20%Maintenance030%015%55%Direct cost$30,000$213,300$40,000$200,000$50,000

Required:

Allocate the service department costs to the two operating departments using the reciprocal method.

Allocated to:

Costs Fabrication Assembly

Engineering XXX xxx xxx

Administration xxx xxx xxx

Maintenance xxx xxx xxx

Total